Reaping the Benefits of Solar
What is the Rural Energy for America Program?
The Rural Energy for America Program (REAP) Grant is a federal program that provides financial assistance to rural businesses for energy efficiency and renewable energy projects. This program has recently been updated under the Inflation Reduction Act, which has increased the grant amount and made it more accessible to a wider range of businesses.
What are the main benefits of a REAP Grant?
One of the key benefits of the USDA solar energy program is that it can significantly accelerate the return on investment (ROI) for a commercial solar system. According to the U.S. Department of Agriculture (USDA), the program can provide loan guarantees on loans up to 75% of eligible project costs, REAP Grants for up to 50% of total eligible project costs, or a combined grant and loan guarantee funding up to 75% of the eligible project costs.
For many businesses, the ROI for a commercial solar system can be anywhere from 5 to 10 years, depending on factors such as system size, location, and energy costs. However, with the REAP Grant, the ROI can be reduced to as little as 2 years.
Another key benefit of the REAP Grant is that it can be used in conjunction with other financial incentives, such as the federal Investment Tax Credit (ITC), currently set up at 30% and state-level rebates. These incentives can further reduce the payback period for a solar installation, making it an even more attractive investment for rural businesses.
❌ Disclaimer
PPM Solar does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.
Deadlines and funding availability
The REAP program has received unprecedented funding due to the Inflation Reduction Act, providing the most substantial financial support in its history. This increase in funding means there is a significant opportunity for rural businesses and agricultural producers to secure grants for renewable energy and energy efficiency projects.
According to local USDA offices in Florida, no projects are currently being turned down due to funding constraints. This is an excellent time to apply and take advantage of the available resources.
❗To ensure your application is considered, be aware of the key deadlines and submission windows❗
September 30, 2024 deadline:
This is the final deadline for REAP grant applications for the current fiscal year. To ensure timely processing, aim to submit your application by September 15-20.
Quarterly target dates:
June 15-30: There is often a surge in applications towards the end of each quarter, particularly in mid-June and mid-September. Submitting early can help avoid the rush and ensure your application is reviewed promptly.
September 15-30: The last two weeks of September are typically the busiest. To avoid delays, it’s recommended to complete your application well before these dates.
Download complete guideGet up to $1M for your solar project through USDA REAP Grant!
Who can apply for REAP Grant?
The REAP Grant is open to a wide range of rural businesses, including manufacturers, farms, ranches, and small businesses. In order to be eligible for the grant, businesses must be located in a rural area. Additionally, businesses must demonstrate that the proposed project will save energy, reduce costs, and have a positive impact on the environment.
Wondering how much you can save with the USDA reap grant?
While you can save a whopping 50% on installation costs with this federal grant, we believe the more important question to ask is, “how much can I save by going solar?”. Just between energy offset and other tax incentives commercial solar projects offer an attractive ROI typically in 5 years or less by combining tax incentives and REAP Grant you can increase an RIO (in some cases) to 2 years or less. Some of our clients report a sub two year payback time on their solar investment by combining reap grant with other federal tax incentives.
This comes from the combination of the REAP Grant’s solar funding and the solar investment tax credit (ITC). While only agricultural or commercial solar projects are eligible for the REAP Grant, the ITC applies to all solar installations – including residential projects.
There is a lot of behind-the-scenes work that goes on in order for you to reap the benefits of this program. Luckily, our grant writer will take care of all the nitty-gritty details.
That being said, we understand how this can sound almost too good to be true… but we promise: it’s just that good. Not only could the REAP grant save you up to 50%, but you will also benefit from the ITC (which covers an additional 30%), MACRS accelerated depreciation AND the fact that there’s no sales tax on solar installations in Florida.
With all of those incentives combined, the payback period for commercial projects can be as short as four years! Given that the ITC won’t be around forever, there has really never been a better time to invest in alternative energy like solar.
What areas are eligible for a REAP Grant?
REAP Grant is a valuable program for rural businesses looking to invest in a commercial solar system. The recent increase under the Inflation Reduction Act can significantly accelerate the ROI of a solar system and make it a much more attractive investment. Whether you are a farm, ranch, small business, or manufacturer, the REAP Grant can help your business save money, reduce its carbon footprint, and contribute to the fight against climate change..
Check the USDA-REAP Rural Eligibility Map to make sure your business address is located in an eligible rural area.
Why apply for REAP Grant with PPM Solar?
PPM Solar is one of the most reviewed solar companies in the country. With a 15-year track record of dedication to customer satisfaction and over 1000 projects performed, our work speaks for itself!
Only highest quality equipment
At PPM Solar, we offer only top tier solar modules, inverters, and mounting structures that have been time-tested while making the latest and greatest technology available. Find out more about specific components that we install by clicking the button below to see our Technical Library.
ProductsCommerscial expertize
We’ve worked on major commercial projects like UF Shands, San Felasco Tech City, and Gainesville Health & Fitness, as well as smaller REAP Grant eligible projects such as General RV, Frog Song Farm, Copperline Farm, and more. Regardless of your industry or the size of your project, PPM has the experience and expertise to assist you.
Commercial portfolioFrequently Asked Questions
How Can I Apply for a REAP Grant?
The United States Department of Agriculture accepts REAP grant applications. Instructions and dates of Fiscal Year programs are available online at Rural Energy for America Program Renewable Energy Systems & Energy Efficiency Improvement Guaranteed Loans & Grants.
REAP Grant application acceptance can be competitive due to the limited amounts of money the USDA allocates each year. One should work closely with with a solar contractor and a USDA program specialist before attempting to fill out any forms or applications. Doing so will save you time when completing your application.
How Does the REAP Grant Work?
The REAP Rural Energy for America Program and Loan Guarantee program provides financial assistance to agriculture producers and rural small businesses to purchase, install, and construct renewable energy systems or energy efficiency improvements. Both solar PV energy systems and backup battery systems qualify.
Is The REAP Grant Paid in Cash?
REAP Grants are essentially federal government-guaranteed loans. Once a REAP application is accepted, the funds are provided in cash in the same manner as a loan.
Are REAP Grants Taxable?
The USDA REAP grant is taxable income and the applicant will get a 1099 reporting earnings. Therefore, the REAP grant should not reduce the eligible federal tax credit amount.